We have tips and action steps for successful franchises.

  • Signing up new franchisees

    A prospective franchisee’s ability to invest in your franchise is important but this shouldn’t be your only consideration. Poor franchisee selection creates all sorts of problems and can damage your brand.

    Assess the potential franchisee, looking out for a few indicators that the person may be a good fit. They should have:

    • Personal commitment
    • Family support
    • Good health
    • Necessary skills and experience
    • Ability to work alone

    Even though your franchise agreement allows you to get rid of ‘bad apples’, this should be a last resort. Having a good relationship with your franchisees is crucial to your success.

  • Marketing your franchise

    Tips for effectively marketing your franchise opportunity:

    • Avoid a hard-sell. Promote your franchise opportunity, but don’t pressure prospects into signing up.
    • Use your website to promote your franchise.
    • Use public relations. This can play a major role in promoting your franchise.
    • Use the power of ‘word-of-mouth’. Nothing is more influential than a personal recommendation from someone who believes in your brand and is willing to talk about it.
    • List your franchise on the Franchising Association of South Africa’s website.
    • Participate in franchise and small business exhibitions.
    • Place advertisements in business-oriented publications.
  • Going global

    Africa’s expanding middle class gives businesses exciting new opportunities. But don’t make the mistake of thinking this is one homogenous market.

    You’ll need to explore the cultural, economic and legal consequences of setting up a franchise for each country you’re interested in. To this end, connecting with individuals who have local knowledge is invaluable.

    Before you set anything in motion, ask yourself the following questions:

    • Have I established a strong presence in my home market?
    • Do I have spare capacity across the board that can be redirected towards international expansion?
    • Am I willing and able to devote sufficient financial resources to the effort?
    • Am I willing and able to devote sufficient manpower to the effort?
    • How long will it take me to become established and profitable in my target country?
    • Do I understand the cultural differences?
    • Do I understand the local legislation that, for example, could fail to offer adequate protection for my intellectual property?
    • Are there any restrictive exchange and/or import controls?
  • Ways to expand internationally

    Once you’ve addressed all the possible issues, you’re ready to decide on a business format. You have a few options:

    • Appoint a master franchisee. You appoint a franchisee in your target country to operate as the franchisor in that country. This is usually the most successful way to expand into foreign markets. The main issues to consider are the legal and cultural differences, exchange control and differences in business ethics.
    • Direct franchising. You sign up foreign franchisees just as you would local franchisees. You’ll need to consider the target country’s legislation and, for logistical reasons, this format is most viable in your neighbouring countries.
    • Set up a subsidiary. You set up a subsidiary in the target country, which acts as the franchisor. It operates one or more pilots to adapt the offering to local needs before establishing franchisees. This approach takes a big investment and carries the most risk because you’ll need an intimate understanding of the local market. But it also offers the highest level of control and potential rewards.
    • Enter into a joint venture. You set up a subsidiary in your target country with a joint venture partner who has an intimate knowledge of the local market. As such, the risks and rewards are shared.
  • Call us

    Name Position Email
    Abigail Makhubele Business Development Manager - Consumer Services, Quick Service
    Restaurants & Restaurants
    James Noble Business Development Manager: Fuel jamesjn@absa.co.za
    Thamsanqa Letsoalo Business Development Manager: Automotive Sector       Thamsanqa.Letsoalo@absa.africa
    Lesego Mpakanyane Business Development Manager: Wholesale & Retail

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